Another thing coming into it for me is the fact that I initially took the bomb thing also as a failsafe in case Ye Zun ever ate him, because Shen Wei is so powerful that Ye Zun getting all of his powers by itself would be scary. So the read of "if Ye Zun ever gets me, I can blow us both up" was more intuitive to me than "I will maneuver a series of complicated circumstances into just the right setup so he will eat me, in order for me to blow us both up."

Our theories actually align, here. I don't think SW's self-bomb option was his only plan. It was, as you say, a fail-safe. (but I don't think he was as torn-up about having to use it as he could have been, either)